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Factual and Procedural Background

The parties, Joseph and Dolores McCready, were divorced by decree entered October 6, 1975, after an essentially uncontested dissolution proceeding in Pinal County. The decree incorporated a settlement agreement dividing marital property, establishing child support for four minor children, and providing spousal maintenance for Dolores. In July 1977 the parties acquired a Tucson residence as "husband and wife" and as joint tenants; Dolores and the children have continuously resided there since acquisition. The purchase price was furnished by roughly equal contributions from each party. The parties never remarried after the 1975 dissolution, and no marital relationship is alleged to have existed after that decree.

Dolores initiated post-dissolution proceedings in Pima County in mid-1986 to enforce and modify Joseph's support and maintenance obligations, including matters "arising out of the sale of the residence." After resolution of arrearage issues, a December 1988 hearing resulted in an order allowing Dolores exclusive use of the residence until the youngest child graduated; that order was not appealed.

In April 1989 Joseph filed a petition seeking an "auction sale" of the residence and injunctive relief for alleged harassment. Dolores responded requesting that the property be appraised by two appraisers (one chosen by each party) and that she be permitted to purchase Joseph's equity by paying one-half of the average of the two appraisals within 90 days. Prior to the August 4, 1989 hearing title had been changed from joint tenancy to tenancy in common by agreement. After the August 4 hearing, the trial court issued an October 31, 1989 minute entry finding the property was held as tenants in common, declaring the parties had submitted to the court's equitable jurisdiction over disposition of the property, ordering appraisal as Dolores requested, and permitting Dolores to purchase Joseph's equity within 90 days of the latest appraisal.

Joseph filed a Rule 60(c) motion and objections to the form of a proposed formal order. On May 17, 1990 the trial court sustained the objections to form but denied Rule 60(c) relief, concluding Joseph had submitted to the court's equitable jurisdiction and was estopped from challenging the court's jurisdiction to make the October 31, 1989 ruling. The trial court later entered an order dated June 12, 1990 disposing of the property as described in the minute entry; that order was appealed by Joseph.

Legal Issues Presented

  1. Whether the trial court lacked subject-matter jurisdiction under A.R.S. § 25-311 to award real property acquired after dissolution to one party.
  2. Whether the trial court lacked jurisdiction to determine fair market value by averaging two appraisals.
  3. Whether the trial court lacked jurisdiction to render a judgment crediting one party's equity against the fair market value to be paid to the other party (i.e., effectively awarding exclusive purchase rights to one cotenant).

Arguments of the Parties

Appellant's Arguments (Joseph McCready)

  • The trial court lacked subject-matter jurisdiction pursuant to A.R.S. § 25-311 to award real property acquired after dissolution to one party.
  • The trial court lacked jurisdiction to determine fair market value by averaging two appraisals.
  • The trial court lacked jurisdiction to render a judgment crediting one party's equity against the fair market value to be paid to the other party (i.e., to fashion the purchase-credit arrangement adopted by the court).

Appellee's Position (Dolores McCready)

  • In response to Joseph's petition, Dolores requested the property be appraised by two appraisers (one chosen by each party) and that she be given the right to purchase Joseph's equity by paying him one-half of the average of the two appraisals within 90 days of the date of the latest appraisal.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Tovrea Land Cattle Co. v. Linsenmeyer, 100 Ariz. 107, 412 P.2d 47 (1966) Supports that the appellate court is not bound by trial court's legal interpretations and may draw its own legal conclusions. Used to justify de novo review of the legal issues raised on appeal.
Aldabbagh v. Arizona Dept. of Liquor Licenses and Control, 162 Ariz. 415, 783 P.2d 1207 (App. 1989) Supports that the appellate court is not bound by the trial court's legal interpretations. Used to justify de novo review of the legal issues raised on appeal.
Saxon v. Riddel, 16 Ariz. App. 325, 493 P.2d 127 (App. 1972) Supports that the only lawful means for disposing of the subject property in the absence of an agreement between cotenants is to follow applicable partition statutes. Cited as authority for the conclusion that the trial court should have followed partition statutes rather than enter the order it did.
Lawson v. Ridgeway, 72 Ariz. 253, 233 P.2d 459 (1951) States that the right of partition is an incident of common ownership and is specifically authorized by statute. Used to support the proposition that partition is the statutory remedy for cotenants who cannot agree on disposition.
Register v. Coleman, 130 Ariz. 9, 633 P.2d 418 (1981) Holds that partition of real property held by cotenants is a statutory procedure governed by statute and that a sale and appointment of a commissioner is required when fair division would depreciate value (A.R.S. § 12-1218(C)). Relied upon to explain the statutory mechanisms required for involuntary partition, including sale and appointment of a commissioner when necessary.
Bledsoe v. Hood, 44 Ariz. 292, 36 P.2d 564 (1934) Supports that partition proceedings are governed by statute. Cited to reinforce that partition is a statutory procedure and must follow statutory requirements.
Frame v. Frame, 227 Mont. 439, 740 P.2d 655 (1987) Expresses the fundamental objective in a partition action: to divide property fairly and equitably so no cotenant receives an unfair advantage. Used to underscore the equitable objective of partition actions and to support the court's view that statutory partition procedures aim for fairness.
Blonquist v. Frandsen, 694 P.2d 595 (Utah, 1984) Discussed in connection with the objective that partition should be fair and equitable. Cited (via Frame) as authority illustrating the equitable aims of partition proceedings.
Palmer v. Protrka, 257 Or. 23, 476 P.2d 185 (1970) Holds that in a partition suit the only relevant equities are those arising out of the relationship of cotenancy. Applied to explain that partition proceedings focus on equities related to cotenancy, not other unrelated equities.
Porter v. Porter, 101 Ariz. 131, 416 P.2d 564 (1966), cert. denied, 386 U.S. 957 (1967) States that parties cannot, by consent, give a court jurisdiction over a subject matter it would not otherwise have. Relied on to reject the parties' attempt to confer jurisdiction on the court by tacit or actual consent to an order the court otherwise lacked power to enter.
Janik v. Janik, 474 N.E.2d 1054 (Ind.App. 1985) Holds that a trial court does not have the power to order one tenant to sell his interest to the other while allowing the tenant in possession to retain the entire tract. Used to support the proposition that the trial court could not unilaterally grant one cotenant the exclusive right to retain the property while forcing the other to sell.
Rankin v. Coffer, 174 N.E.2d 631 (Ohio App. 1960) Provides authority that the trial court lacks power to force one tenant to sell while allowing the other to retain the entire property. Supplemental authority to show the impropriety of the trial court's ordering one cotenant to be excluded from retaining an interest while requiring the other to abandon rights to possession.
Occhino v. Occhino, 164 Ariz. 482, 793 P.2d 1149 (App. 1990) Holds that the right of partition is a continuing one lasting as long as the cotenancy exists. Cited to support that Joseph retained a continuing right to seek partition while cotenancy remained.
Beltran v. Razo, 163 Ariz. 505, 788 P.2d 1256 (App. 1990) Affirms that the right of partition continues as long as cotenancy exists. Used to reinforce that a cotenant's partition rights continue and cannot be foreclosed by the trial court's order granting exclusive purchase rights to the other cotenant.

Court's Reasoning and Analysis

The court framed the issues raised on appeal as questions of law and stated it would review them de novo, citing authority that an appellate court is not bound by the trial court's legal interpretations. The court concluded that the trial court lacked jurisdiction to enter the particular order it did because, in the absence of a voluntary agreement between cotenants, the proper and lawful method to dispose of commonly held real property is to follow the statutory partition process.

The court explained that Arizona law recognizes partition as an incident of common ownership and that partition is a statutory procedure governed by A.R.S. §§ 12-1211 et seq. It emphasized that if a fair division cannot be made without depreciating value, the statutes require sale and appointment of a commissioner to conduct the sale and divide proceeds according to the parties' interests (A.R.S. § 12-1218(C)), and that the fundamental objective of partition is fairness and equity among cotenants.

The court noted the parties had attempted to use their post-dissolution proceeding as an expedient forum to resolve the property dispute and, by tacit or actual consent, to empower the court to enter the contested disposition. However, the court held that parties cannot, by consent, give a court jurisdiction over a subject matter it would not otherwise have, and thus the parties' attempted shortcut did not cure the absence of statutory partition procedure.

Applying these principles, the court found the trial court's determination that only Dolores had a right to purchase the property effectively denied Joseph his continuing right of partition. Because the trial court's order did not comply with the statutory partition requirements, the appellate court reversed the trial court's disposition of the property.

Holding and Implications

Holding: The appellate court concluded that the trial court's order disposing of the parties' commonly held residence did not comply with the statutory partition scheme and therefore reversed. The core ruling is emphasized as: REVERSED.

Implications:

  • Direct effect on the parties: The trial court's June 12, 1990 order disposing of the property was reversed because it failed to follow A.R.S. §§ 12-1211 through 12-1225. Joseph's right to partition was recognized as continuing and could not be foreclosed by the trial court's order granting Dolores the exclusive purchase right in the manner implemented.
  • Attorneys' fees: Because no statutory authorization for attorneys' fees exists in a partition action, the court awarded no attorneys' fees.
  • Broader legal effect: The opinion directs that statutory partition procedures govern involuntary dispositions of cotenanted real property absent a voluntary agreement. The opinion does not set forth broader changes to existing law beyond the application of partition statutes to the facts here.

In re the Marriage of Joseph L. McCREADY, Petitioner/Appellant, v. Dolores I. McCREADY, Defendant/Appellee.

OPINION

JAMES C. CARRUTH, Judge.[fn*] [fn*] A Judge of the Pima County Superior Court authorized and assigned to sit as a Judge on the Court of Appeals, Division Two, pursuant to Arizona Supreme Court Order filed July 25, 1990.

Petitioner Joseph McCready appeals from the trial court's judgment in favor of respondent Dolores McCready in this action to dispose of their commonly held residential real property. As set forth below, we reverse.

FACTS AND PROCEDURAL HISTORY

In October 1975, the McCreadys' marriage of some 11 years was dissolved in the Pinal County Superior Court as the result of an essentially uncontested petition for dissolution filed by Joseph. The decree of dissolution then entered divided all of the marital property of the parties and provided for child support for the parties' four minor children and spousal maintenance for Dolores, consistent with the provisions of a settlement agreement which the parties had reached. The settlement agreement was found acceptable by the court and incorporated into the provisions of the decree of dissolution entered on October 6, 1975.

The property which is the subject of this dispute is a residence located in Tucson which was acquired by the parties in July 1977 and in which Dolores and the children have continuously resided since that time. Joseph also resided there for several years after the acquisition of the residence. Title to the subject property was taken by the McCreadys as "husband and wife" and as joint tenants. The purchase price was furnished by roughly equal contributions from Joseph and Dolores. The parties never remarried each other and no contention is made in the instant proceeding that a marital relationship existed between the parties after October 1975.

All but one of the children had reached majority at the time of the instant litigation and were away at school or otherwise living separately.

The action which is the subject of this appeal was filed in the Pima County Superior Court in mid-1986 by Dolores for the purpose of enforcing and modifying Joseph's obligations for support and maintenance, among other things. The arrearage issues were largely settled between the parties following somewhat protracted litigation and negotiation, but issues associated with Dolores's efforts to modify the provisions for maintenance and "arising out of the sale of the residence" went to hearing and resolution by the trial court in December 1988. The court allowed Dolores the exclusive use of the subject property until the parties' youngest child graduated from high school. That order was not appealed.

In April 1989, Joseph filed a petition in the same Pima County post-dissolution cause seeking an order of the court requiring an "auction sale" of the subject property as well as injunctive relief from alleged harrassment by Dolores in the form of telephone calls at his place of business. This petition alleged, inter alia, that the youngest child was about to graduate from high school and advanced Joseph's desire that the property be sold to the highest bidder at an auction to be conducted by the civil division of the Pima County Sheriff's Office. Dolores's response to the petition asserted, inter alia, that the subject property should be appraised by two appraisers, one chosen by each of the parties, and that Dolores be given the right to purchase Joseph's equity by paying him an amount equal to one-half of a figure to be arrived at by averaging the two appraisals and by paying Joseph the required amount within 90 days of the latest appraisal. A hearing on the subject petition was conducted on August 4, 1989, during which the parties apparently advised the court that all issues, save disposition of the property, had been resolved. Following this hearing and the court's being advised that the parties had been unable to negotiate any disposition of the property, the court issued a ruling by minute entry on October 31, 1989, which found that the property was held by the parties as tenants in common and that, although neither party had requested partition or the appointment of a special commissioner pursuant to A.R.S. § 12-1211, both parties had "submitted themselves to the equitable jurisdiction of the court by requesting relief regarding disposition of their commonly held property." The court then ordered that the property be appraised in the manner requested by Dolores and that she be allowed to purchase Joseph's equity by making the required payment within 90 days of the latest appraisal.

A change in title from joint tenancy to tenancy in common was accomplished by agreement prior to the August 4, 1989 hearing.

Thereafter, Joseph filed a motion for relief under civil Rule 60(c) together with certain objections to the form of the formal order prepared for the court's signature by Dolores's counsel. After a hearing on the motion, the court issued an order on May 17, 1990, sustaining the objections to the form of the order and requiring that a new order be presented but denied the motion under Rule 60(c) because of the trial court's conclusion that petitioner had submitted himself to the equitable jurisdiction of the court and was "estopped from now raising the lack of jurisdiction of the court to make the ruling it did in its October 31, 1989 minute entry ruling."

ISSUES

On appeal, Joseph argues that the trial court (1) lacked subject matter jurisdiction pursuant to A.R.S. § 25-311 to award real property acquired after dissolution to one party, (2) lacked jurisdiction to determine fair market value as an average between the estimates of two appraisers, and (3) lacked jurisdiction to render a judgment which credited the equity of one party against the fair market value of real property to be paid to the other party.

DISCUSSION

The issues raised on appeal relate entirely to questions of law. This court is not bound by the trial court's legal interpretations. We are, therefore, free to draw our own conclusions from the facts presented. Tovrea Land Cattle Co. v. Linsenmeyer, 100 Ariz. 107, 114, 412 P.2d 47, 51 (1966); Aldabbagh v. Arizona Dept. of Liquor Licenses and Control, 162 Ariz. 415, 418, 783 P.2d 1207, 1210 (App. 1989).

Our review of this matter leads us to conclude that the trial court lacked jurisdiction to render the particular order entered because the only lawful means for disposing of the subject property in the absence of an agreement between the parties for a voluntary disposition was to follow the applicable partition statutes. See Saxon v. Riddel, 16 Ariz. App. 325, 328, 493 P.2d 127, 130 (App. 1972).

Arizona cases hold that the right of partition is an incident of common ownership and is specifically authorized by statute. A.R.S. § 12-1211; Lawson v. Ridgeway, 72 Ariz. 253, 265, 233 P.2d 459, 467 (1951). A.R.S. § 12-1211(A) states:

The owner or claimant of real property or any interest therein may compel a partition of the property between him and other owners or claimants by filing a complaint in the superior court of the county in which the property, or a portion thereof, is situated.

The partition of real property held by cotenants is a statutory procedure and, as such, the proceedings are governed by the statute. Register v. Coleman, 130 Ariz. 9, 14, 633 P.2d 418, 423 (1981); Bledsoe v. Hood, 44 Ariz. 292, 295-96, 36 P.2d 564, 565-66 (1934). Parties, of course, can agree to a voluntary partition of property which may be effected in any manner upon which the cotenants agree. See 59A Am.Jur.2d Partition § 68 (1987), and cases cited therein. In the absence of such an agreement, the court must use its equitable discretion in a partition action to achieve fairness between the parties. "The fundamental objective in a partition action is to divide the property so as to be fair and equitable and confer no unfair advantage on any of the cotenants." Frame v. Frame, 227 Mont. 439, 441, 740 P.2d 655, 658 (1987), citing Blonquist v. Frandsen, 694 P.2d 595, 596 (Utah, 1984). See also 59A Am.Jur. 2D Partition § 6 (1987).

In a partition suit, the only relevant equities are those which arise out of the relationship of cotenancy. Palmer v. Protrka, 257 Or. 23, 25, 476 P.2d 185, 188 (1970). The statute sets forth specific procedures for an involuntary partition action, which, in essence, was what the court was presented with here. Under the statute, if it appears to the court that a fair division of the property cannot be made without depreciating the value thereof, it is required to render a judgment directing that the property be sold. The court is also required to appoint a commissioner to conduct the sale and divide the proceeds between the parties according to their respective interests. A.R.S. § 12-1218(C). Register, 130 Ariz. at 14, 633 P.2d at 423.

It is clear from the briefs filed here and in the trial court that the parties recognize the applicability of the partition statutes and winked at the jurisdictional problem in an effort to obtain an expeditious forum for the resolution of their dispute. While undoubtedly a properly presented claim respecting partition of the subject property was cognizable in the post-dissolution action (see for example Restatement (Second) of Judgments § 9 (1982), "Jurisdiction Over Litigants Concerning Other Claims"), the parties here attempted to empower the court with jurisdiction by tacit, if not actual, consent to enter an order which it simply could not otherwise enter. "[P]arties cannot, by consent, give a court jurisdiction of a subject matter of which it would not otherwise have jurisdiction. . . ." Porter v. Porter, 101 Ariz. 131, 137, 416 P.2d 564, 570 (1966), cert. denied, 386 U.S. 957, 87 S.Ct. 1028, 18 L.Ed.2d 107 (1967). The subject property was never "marital property" and thus subject to any of the provisions of Title 25. The only remedy left in the absence of a voluntary agreement for its disposition is an involuntary partition proceeding in which the statutory mechanism must be followed.

That Joseph took no appeal from the earlier order allowing Dolores to have exclusive use of the property until the youngest child graduated from high school, and later chose a procedurally defective mechanism to achieve a sale, does not change this conclusion. Since the inception of the post-dissolution litigation concerning this property, Joseph's position has always been consistent — the property should be sold. That he went about it incorrectly does not create an estoppel to now raise the applicability of the partition statutes.

It is well established that when there are but two parties and each desires to have allotted to himself or herself the whole cotenancy property, the court cannot arbitrarily decide that one shall have the property to the exclusion of the other. 68 C.J.S. Partition § 168(2) (1950). "In considering a petition for partition, the trial court does not have the power to order one tenant to sell his interest to the other, while allowing the tenant in possession the right to retain the entire tract." Janik v. Janik, 474 N.E.2d 1054, 1057 (Ind.App. 3 Dist., 1985); see also Rankin v. Coffer, 85 Ohio L.Abs. 391, 392, 174 N.E.2d 631, 633 (App. 1960).

The trial court's determination that only Dolores had a right to purchase the cotenancy property denied Joseph his right of partition. In this state, the right of partition is a continuing one which lasts as long as the cotenancy exists. Occhino v. Occhino, 164 Ariz. 482, 484, 793 P.2d 1149, 1151 (App. 1990); Beltran v. Razo, 163 Ariz. 505, 507, 788 P.2d 1256, 1258 (App. 1990).

CONCLUSION

Because the trial court's order of June 12, 1990, did not comply with the requirements of A.R.S. §§ 12-1211 through -1225, we reverse. Because no statutory authorization exists for attorneys' fees in a partition action, no fees are awarded.

FERNANDEZ, C.J., and HOWARD, J., concur.

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McCREADY v. McCREADY
(Apr 23, 1991)